Time for Iowa City to stop subsidizing the 1 percent

Iowa City stands poised to subsidize The Chauncey through a $12 million “money up front” tax increment financing loan along with a $2 million gift of city property.

We call upon our community to oppose this breathtaking wealth transfer from working families struggling to make ends meet to provide subsidized housing for the 1 percent.

It’s morally wrong and bad public policy.

Affordable housing remains a pressing concern for our community. Renters struggle to find a clean affordable place to live. Homeowners continue to see their property taxes rise while receiving less in return. Friends and neighbors living in the mobile home parks wonder whether their park may be razed to make room for commercial development. All of our leaders agree this remains a key issue, but they have done little to address it.

Instead, they have made providing affordable housing for the 1 percent their most compelling focus.

Just look at the facts. Since 2003, the city has agreed to provide nearly $20 million TIFs to three projects: Plaza Towers, Park@201 and now The Chauncey. These projects consist largely of luxury units with some approaching $1 million. Unsurprisingly, these wealth transfers have created a golden age for the 1 percent.

While working families remain largely locked out, the city’s continuing tax subsidies have created an affordable housing bonanza for the 1 percent, providing access to “living spaces (that) have commanding views with generous private balconies” and access to “numerous restaurants, retail establishments and entertainment venues in downtown Iowa City.”

Worst yet, our city seems to be OK with raiding affordable housing funds to subsidize the housing needs of the 1 percent. In addition to the $14 million subsidy, they also have agreed to use $1 million from past affordable housing sales to pay for five “affordable” Chauncey units averaging as much as $200,000 per unit.

Using those past affordable sales as a benchmark, we tried to determine how much more expensive per square foot the Chauncey units would be as opposed to past affordable units. We’ve asked that basic question, but city staff has refused to answer. So we remain in the dark about any aspect of that proposed affordable housing sale.

Finally, the tax subsidy for The Chauney has supplanted and driven away millions of dollars of potential economic growth. New Pioneer Co-op is now investing millions in a new facility in Cedar Rapids as a direct result of the city’s unstinting support for luxury housing subsidy for the 1 percent.

Millions more of expanded purchases will be lost. Most troubling, the flagship store sits perilously on the flash flood creek and now faces a new organic foods competitor.

The late great Pete Seeger once asked his followers, “Which side are you on, brother, which side are you on?” We stand on behalf of the entire community rather than the politically connected few.

We firmly believe that high resources folks form a key thread in our downtown social fabric and should always be a part of the downtown development strategy. But their housing and entertainment needs should not be subsidized by inflated affordable housing purchases or with tax dollars from hardworking families. Oppose this unjust housing subsidy.

Iowa City lawyer Rockne Cole is one of the organizers for the Coalition Against the Shadow, which has filed a lawsuit against the Iowa City Council over the zoning of the city-owned land where The Chauncey is set to be built.